There are certain things in life that you will wish to avoid if you want to have a secure financial present and future for yourself and your family. Credit card debt is certainly one of those things that you should be avoiding. People do not always realise or think about it but keeping an outstanding credit card balance is one of the most expensive financial arrangements you could possibly subscribe to. If you have even an average interest rate, and not too much of an outstanding balance, you could be wasting literally hundreds of pounds a year by not paying off your outstanding balance in full each month.
There are also other problems with keeping a high amount of credit card debt. You will be making your credit rating worse for one thing. And this is something that you should be concerned about. Credit providers, banks, insurance companies and even employers will use your credit rating as a means of assessing your financial standing. If you have a very high outstanding credit card debt, or are close to your credit card debt limit, this will be regarded as a negative in the assessment of your credit score and for this very purpose, it is something that you should be attempting to avoid.
A lowered credit rating will cause you to receive worse terms and offers for future credit. For example you may get
If you wish to avoid one or more of the above out comes, you should be trying to keep your credit card debt under control. One way to do this is to simply stop using them. Discipline yourself, or if this is too difficult, take the credit cards that you are using, out of your wallet or purse, so that you cannot give in to the temptation of using them. This way, the amounts you pay back will start to reduce your outstanding balance and you will get things back under control.
Another thing you should be making sure that you are doing is repaying more than the minimum repayment on your monthly bill. Many cards allow you to repay just the interest, and if you are doing this, it means that you are repaying none of the actual outstanding balance each month so even if you stop using the credit card, you will not be paying them off. You are simply servicing the debt. You should make sure that you are paying back the credit card balance over a reasonable period.
How often have you seen someone going through their wallet searching for a credit card in the checkout line- and were shocked by the number of cards they had in their wallet? Credit cards can be used as a form of identification when applying for a major purchase, or when renting a car; and they can be used for convenient purchases that you wont have to pay for until a month after you buy them.
Except, thats not how it usually happens. Typically, people who have an abundance of credit cards use them frequently, and have to carry a balance from one month to the next because they are unable to pay each card off in full when the bills come in. So what happens then? Credit card holders are being charged high interest rates for each of their purchases, sometimes up to 24%! Credit cards are habit forming. It is very easy to pull out a piece of plastic, swipe it through the register and buy something you couldnt afford otherwise. Its tempting to think that the money will come later, and youll pay for it then. More often than not, the bills are more than the money you have later to pay them with. A study in 1999 showed that consumers in America used credit cards to charge over $1.2 trillion.
Even with this kind of negative usage, credit cards, when used properly, are a terrific source of financial convenience. The trick is to not over indulge yourself when you use them.
Its also helpful to keep only one or two credit cards available to you at one time. Even if you receive a new credit card offer in the mail every day, you should stick to having a general use credit card (one that can be used for any kind of purchase), and one for emergencies. An emergency credit card allows you the peace of mind of knowing if an unexpected expense comes up that you have to pay, but dont have the extra money available to pay it, you at least have a backup in the form of a credit card that will allow you to pay for it.
Using a general use credit card should be done with extreme discipline. Select one that offers rewards, cash back or other features that you can benefit from. Make your weekly purchases on your general use credit card, from gasoline to groceries, and keep track of your purchases so you know how much money you are using on the card. That way, you will know when youve reached your spending limit for each week based on the amount you have budgeted for such purchases. Set aside money from your paycheck each week for your credit card. When the bill comes in the mail, immediately send out the check for the FULL AMOUNT. This avoids finance charges, but has allowed you to earn interest on the money for the full month that you kept it in your bank account prior to mailing the payment!
When you use a credit card for your every day purchases with the discipline required to keep your spending in check, you are going to benefit greatly from the rewards programs and interest free purchasing power you get when you pay off your balance each month in full. You are able to keep higher amounts of money in your bank accounts for longer periods of time, allowing the money to earn a little interest before the credit card payment is due. You also are building a strong credit rating by making purchases and paying them off each month, and will help you when its time to apply for a mortgage or large loan for a new car or boat or other high ticket item.
In 1950, the first credit card that could be used at more than one, specific merchant emerged on the market. The Diners Card, started by Frank McNamara, was an invention that got its start when Frank was having a business meeting over dinner, and realized he had forgotten his wallet at home. Of course, the man was extremely embarrassed, and had to call his wife and ask her to bring him his wallet so he could pay for the bill. Then the light bulb over his head turned on, and he thought it would be incredible to have a way to purchase things wherever people shopped, and pay for them later. The Diners Card started with 200 card holders, and within a few years- banks and private companies began offering credit cards.
Eventually there were so many credit cards to choose from that the credit lenders had to come up with new ways to stand out from the competition and entice people to select their card over another. Credit card reward programs were born sometime around 1986. Discover card began offering cash back based on the amount of money you spent on your credit card, and the first frequent flier miles for credit card users was with Continental Airlines. The frequent flier miles were such a hit that now every airline has joined in the rewards programs, offering discounted trips, free complimentary airfare, travel accident insurance- all based on the amount of spending you do using your credit card.
Now that just about every credit card has some sort of rewards program in place, once again card companies are finding themselves looking for new ways to entice more customers to slide their credit card into their already overflowing card holders in their wallets. Rewards programs have to be turned up a notch, and become so amazing, so absolutely unforgettable that consumers cant forget them and will apply for and use their card more than the other seven in their wallets when they go shopping!
Currently, the trend in credit card rewards programs appears to be creating cards that offer very specific rewards to cater to what people are doing with their lives. Michelle Shepherd, of MBNA Corp (one of the largest credit card lenders) says the rewards programs are developed with real people in mind, offering something for everyone whatever stage in life a person is in, whether its someone whos trying to reduce a mortgage or someone dreaming of going to the Super Bowl. This is seen in credit cards MBNA offers with rewards programs related to NASCAR and GMAC. Also, Visa offers several credit cards with Disney rewards programs- your spending earns you points towards travel to Disney theme parks and on the Disney cruise line.
Credit card interest rates have begun to rise overall, which is another reason why lenders are trying to entice new customers with their fabulous rewards programs. It would be hard for a card to sell itself to new customers with a high, unattractive interest rate- so lenders have learned to sell the idea of the rewards programs, hoping to gain your interest from that and divert your attention from the not-so-glamorous interest rates.
Keep in mind that while rewards programs can seem very rewarding when you are considering a credit card offer, there is often a lot of information you wont find out until after you apply for and receive the card. Rewards programs often have limitations, meaning once you reach the ceiling you are no longer eligible for the rewards program benefits- information they dont normally disclose in the credit card offers you receive in the mail. Also, for rewards programs that allow you to purchase items with points earned based on the spending you do using your credit card, keep in mind you will probably be charged additional money for shipping and handling of those items. For cards that offer travel discounts and airline tickets, many rewards programs require you to then pay transaction fees to redeem them.
Put the power of credit card rebates in your wallet! This can be done very easily if you have good or excellent credit, pay your balance monthly, and enjoy spending money to receive cash back on your purchases.
These unique credit card rebates are all over the place and they provide cardholders with cash rewards or rebates when they shop just like they normally would. All you have to do is use your credit card and purchase items that you always buy from your favorite store and you earn a percentage that you spend back in rebates. The average percentage rate is around 1% to 5% according to which credit card company you choose.
You may first wonder, what the gimmick is, because you know there is one. Well, to put it simply, the credit card rebates are given to you because the credit card company charges the business a fee. This fee is used to give you a rebate. You may also notice that with some credit card rebates you may be paying higher interest fees and annual fees than you would with a regular credit card. These annual fees are usually between $25 and $100 per year.
Many times with credit card rebates such things as balance transfers and cash advances do not count toward your rebate, but there are a few credit card companies that do offer $5 with all balance transfers. You will have to read the terms and conditions and of course the fine print to learn which credit card companies offer credit card rebates with balance transfers and cash advances.
Most credit card rebates are great even if you may have to pay a higher APR. Today, there are some credit card companies that are still keeping the APR as low as possible while offering credit card rebates. However, if you do not pay your balance on time you will soon learn that the money you would be earning is gone due to paying interest on your balance. The best way to avoid paying interest is to pay off your entire balance monthly. You may find that you are paying more in interest than you are actually earning in rebates if you carry a balance.
Remember, all credit card rebates are a great way to get something back for all your spending but for most credit card companies they only give these type of credit cards to individuals with good or excellent credit.
You already know a lot about credit cards. You’ve heard that consumer debt in this country-particularly credit-card debt-is at an all-time high, while our savings rate is lower than ever before. You realize that the boom in online shopping, with its absolute dependence on credit cards, is further fueling their use. You are well aware that running a balance on your plastic-and paying the unconscionable interest rates that come with it-is one of our most basic and widespread financial blunders. And you suspect that the sheer volume of direct-mail credit-card solicitations with low teaser rates must be devastating the forests of northern Idaho.
Still, credit cards are a fact of 21st century life, and it only makes sense to understand how to use them wisely. While it’s probably impractical to keep all plastic out of your wallet, it is prudent to limit the number of cards you have, and, of course, to pay all balances in full every month. Indeed, having only a traditional American Express card, which doesn’t allow you to carry a balance, can be an excellent way to impose fiscal discipline on you and your family-although, as the Visa ads point out, not everyone accepts American Express. For the rest of us, who do occasionally dabble in credit-card debt, here are a few ways to keep your habit under control.
1. Take advantage of frequent-flier programs tied to credit cards, but keep in mind that interest payments on a high balance can quickly turn “free” flights into outrageously expensive ones. At a dollar per mile, running up a debt of 25,000 may get you a plane ticket, but it will also saddle you with $4,500 in yearly interest payments, assuming an 18% annual rate.
2. Look very closely at credit-card offers before you bite. Obviously, most of those 2.99% and 3.99% rates will be in effect for only a few months. But there may be other catches as well. Making a late payment, even if it arrives only a day after it was due, may immediately trigger a permanent rate hike. Also, low initial rates sometimes apply only to transferred balances, and you could get charged a fee for making the transfer. Check, too, to see whether there is an annual fee, or charges for exceeding your credit limit or even for closing an account.
3. Avoid amazing grace-period tricks. What you’re looking for is a provision that says you’ll never be charged interest as long as you pay your bill in full by the due date. But some cards have no grace period, calculating interest from the moment you make a purchase, while others give you only a limited time after making a charge before interest is imposed. That period of 20 days or so may end before your payment is due.
4. Don’t forget to cancel cards you no longer use. If you don’t, they’ll show up on credit reports, and that could be a problem, particularly if you’re applying for a home mortgage. Your would-be lender may be reluctant to make a loan to someone who has a cumulative credit-card limit of $50,000, $100,000, or even more.
These days there are so many ways to let credit get out of control that you will probably be constantly aware of the dangers of over spending. So many people have access to far more credit than they think they need or can afford, and it is a constant challenge not to let it get out of hand and fall into the trap of spending it all. For most people, credit cards are probably the most dangerous element of this situation and the one they will keep tabs on most closely. If you can get your credit card debts under control then you will have gone a good way to getting your finances and especially your spending under control. This is vital as credit card debt and other similar short term debts are one of the first places future lenders will look when assessing your credit worthiness for future borrowing.
There are a few very simple ways to go about keeping credit card debts under control. They are really just common sense but it is useful to recap over them as many people fall into the trap of thinking that there is some sort of magical short cut to clearing your credit card debts. Sadly this is simply not the case, and despite all the amazing deals on the market, such as zero per cent balance transfers, and loyalty rewards, the only way to clear your self of your credit card debts is to simply pay them all back.
The first thing you should do is cut back on your credit card use. You will have to stop spending so much so that your repayments can start to go back to reducing your balance rather than just keeping it where it is. If you think you will have trouble cutting back on your spending, then perhaps you should think about removing your credit cards from your wallet or purse, and leaving them at home. An even more drastic step is to cut them up.
You should also make sure you are making more than the minimum repayments. Making minimum repayments will never clear the debt, or at least it will take you a very very long time. What you should do is make as much above the minimum payment as you can afford, concentrating most of your repayments on the cards with the highest interest rates.
If you are having real difficulty meeting repayments, then you should perhaps consider contacting the credit card company and telling them of the situation and asking them if they can do anything to help you.
Choosing the right business credit card is essential to your business. A business credit card is good for those who have their own small business or have a company that they run. There are many credit card companies out there with small business credit card offers and they each have their own pros and cons. Finding the right one for your wallet and your business is entirely possible but only if you take the time to learn a little about each one and their terms and conditions. This will help you to avoid any upsetting surprises later on down the road.
It is important to remember that while these business credit cards are extremely helpful to those that are starting up a business and those that have a successful one, these companies are not in it just to be useful. They are giving these cards to business people like you to make money. Many of these small business credit card companies are even adding special perks such as rewards like airline miles and even cash back incentives.
Small business owners can use these credit cards for start up capital as well as in times of need when business is slow. Once they get their business up and going then they can repay the debt that they owe when they can afford to. Being able to use a small business credit card in a time like this can be priceless.
There are many different small business credit cards out there, and it is essential that you be very careful in which one you choose. Also, you need to make sure that you can afford to get a business credit card or several business credit cards before you actually sign any papers. For instance, if you are using this small business credit card to start up your own business, you may want to consider how this debt may affect your future finances. If you think that your business will not make it, then you should try to come up with another way of getting the money. If on the other hand you think that it is sure to succeed and you will be able to repay the money then you should go ahead and do what you have to do to get it done even if it means getting into debt with a business credit card.
It is essential that you shop around and find the business credit card that is the best for you and your own situation. The following is a small list of some of the things to take a look at in the contract of any business credit card you are considering signing up for:
1) Interest rates, this is their annual APR
2) Is their interest rate only good for a short period of time? How much does it go up after that?
3) Annual fees, do they have any?
4) What kind of rewards are they offering?
5) The credit limit
6) The grace period
7) The ability to take out cash withdrawals 
Are balance transfers allowed?
No matter what business credit card you choose, there may or may not be catches to it, which is why it is up to you to decide which one works the best for you and your business. The business credit cards that I have listed above are business credit cards that I have researched so that I could provide you with some samples of what a business credit card has to offer, keep in mind that they are never the same. Each small business credit card has its own way of going about things. They all have different APRs and monthly payment procedures, just make sure you know what yours are.
The credit card wars continue to heat up and that spells good news for consumers. Despite rising interest rates, many issuers are continuing with their popular 0% introductory APR plans, giving new card holders a great way to save money and pay off their debts. One issuer, Advanta, has thrown the gauntlet down and is now offering an extremely low APR on balances until the debt is paid off. Lets take a look at three Advanta offerings to find the one that has the best advantage for you and your wallet.
Advanta Platinum Business Card With Rewards
There just arent too many cards out there offering 0% APR beyond the first 12 months of issuance. And why is that? Because, credit card issuers know that interest rates will continue to head up. Fortunately, Advanta is not letting interest rate trends dissuade them from making an important marketing decision: the
Advanta Platinum Business Card with Rewards extends the 0% APR period through 16 months, a rarity in the credit card business. Whats more, as the name of the card implies, it comes with a rewards program too. Consumers can get 5% cash back on many purchases or use their points for travel rewards. For a $35 annual fee the card can be transformed into an airline miles accumulator.
Advanta Platinum Business Card
An alternative to the Business Card with Rewards is the Advanta Platinum Business Card. No, you dont get rewards with the card, but you do get a 12 month 0% APR and a beefy credit line of up to $50,000! This can be the perfect card for business people who must charge just about everything, but dont want to be restricted by a lower credit line.
Advanta Life-of-Balance Platinum Card
Perhaps one of the most unusual cards in the Advanta arsenal is the Advanta Life-of-Balance Platinum card. If you have balances to transfer, this card can be extremely beneficial as the 2.99% fee on balance transfers stays in effect until the card is paid off. In addition, the card pays you 6% cash back on many purchases or you can redeem your points for travel rewards. Best of all, there is no limit on earnings so you can accumulate an unlimited amount of points every year. A truly unusual offer for a truly exceptional card!
So, which business card is right for you? Well, only you can make that determination. Each of the three Advanta cards has its own special features, so weighing what is important to you against what doesnt matter is one way to go about selecting a new credit card. Still, each Advanta card has so much to offer and getting an Advanta card gives you advantages over many ordinary business cards. Regardless, offers such as these are certain not to last forever, so taking action now will ensure that you get the best card that meets your needs.
Most people these days expect to be able to pay with a credit card, whether they are at the local gas station or working with an independent service industry person who runs a business out of his or her home.
If you are a business owner who has been reluctant to accept credit cards in the past, you need to understand how important it is to accept credit cards and how it will help your business.
First off, people tend to think that businesses that don’t accept credit cards are unprofessional. It’s a silent message to your customers or clients that you don’t take your business seriously enough to pay the application fee and other fees associated with payment processing through credit cards.
Further, customers might be annoyed by the fact that you don’t accept credit cards. Most people don’t carry cash anymore, and they might not always have a checkbook with them, but you can bet they always have a credit card, ATM card or check card in their wallet. Make it easier for your customers by accepting the payment method they always have on hand.
If you receive payments through invoicing clients, accepting credit cards is much more convenient and will save you time. Instead of having to type up an invoice, print it out, mail it, wait for a check to arrive, drive to the bank and cash the check, all you have to do is run a credit card payment. If you add up the time and expense in terms of supplies and postage of billing in this way, you’ll see that your merchant account fees are lower than the amount you spend to send invoices.
Another advantage for you when it comes to accepting credit cards is that it can help get some of your past due accounts cleared up. When people know they can use a credit card and still pay over time, they will choose that option and you’ll get your money faster.
This gives your business a better profile because it means you have less bad debt on your accounts and a higher cash flow.
Even if a lot of the sales at your business are small, you’d be surprised how many people will charge $5 for a cup of coffee and a bagel or a sandwich and drink. Giving people the option to pay with a credit card is always a good idea, and it may actually increase your sales as people who never carry cash and hate to write checks will visit your business more often.
It pays to take the time to consider accepting credit cards. Weigh the costs of a merchant account against the amount your sales or cash flow might increase and you’ll likely find the fees don’t make credit card processing too expensive after all.
0% Balance Transfer Credit Cards – Too Good to be True?
On the surface, 0% balance transfer credit cards are incredibly enticing, especially if you have outstanding credit card balances. But there are a few details you need to understand before taking the balance transfer credit card plunge.
Some consumers seem to get in trouble overnight with credit cards. Seemingly broke and deeply in debt, some desperate card holders are constantly on the lookout for a quick fix for the credit problems. A 0% credit card balance transfer
might appear to be the perfect solution. Many among us desperately jump at such offers without much forethought. 0% deals on balance transfers or purchases might seem irresistible even to the most credit worthy person. But especially if you have a large outstanding card balance (or balances), a 0% credit card balance transfer will seem especially lucrative. And to no surprise, there is no shortage of these type of balance transfer offers currently available in the marketplace.
Regardless of your credit circumstances, you should exercise caution and thoroughly investigate all aspects of any credit card offer that you consider. Despite the obvious attractions of a balance transfer credit card, it is worth giving a second thought before you cut up your old credit card to make room in your wallet for the new one. Companies often fail to clarify the fine print, hiding those rather unpleasant details which could cost you dearly in the long run.
Let us start with a very typical credit scenario. Imagine having a $10,000 outstanding balance on a credit card with a 10% annual APR, translating to $1000 in finance charges on a yearly basis. On the other hand, imagine securing a credit card that offers you 0% on balance transfers for the first year of membership. Transferring your card balance to a 0% balance transfer offer would cut down your annual interest expense by $1000. Exciting, isnt it?
But did you bother to check what the interest rate would be after the introductory interest-free period? The rate might turn out to be significantly higher than your existing card, and you do not want to be caught on the wrong side of a high APR. Forewarned is forearmed. You will need to plan ahead and not just a day or two before the interest-free period comes to an end. Some consumers might be surprised to discover that when an introductory APR offer expires that the rate of interest can revert retroactively to an APR of 23% and beyond. If you do not pay off your balance systematically and end up with a large balance when the introductory offer expires, many times consumers are stuck paying out an outrageously high APR because they did not pay down their card balance at all. So above all, make sure to plan on paying off that balance before the introductory period expires or you may regret it.
0% Balance Transfer Some Pointers
When considering balance transfers credit cards, help yourself by asking these questions:
- What will be the interest rate once the initial introductory 0% balance transfer period is
over?
- Is it comparable to my current APR or will it be significantly higher? What is the net difference?
- Particularly if you plan to carry a card balance over time, what will be the long-term net effect of the difference in APR’s?
- Do I want to get into the habit of switching from one 0% balance transfer card to another?
If your current credit card offers a better long-term ongoing APR than the new one, it makes more sense to stick with what youve got, especially if you have the means to pay off your card balance without incurring large finance charges. A balance transfer card most certainly has its own pros and cons but if you wish to use balance transfers to your advantage, make sure that you understand the net benefits of the card over the long term.